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Subject: China slashes interest rates as panic spreads
Zhang Fei    11/26/2008 2:08:13 PM
It'll be interesting to see if the party starts using live ammo for riot control. Information about domestic events is still tightly controlled, so most people will be unaware that live ammo was used. On the other hand, if no one knows that the government is shooting demonstrators, then more demonstrations and riots will occur. (Quote) The People's Bank of China cut interest rates by more than 1pc point as the economy crumbles and millions of jobs are predicted to go ahead of Christmas. The move came just one day after the World Bank predicted that China would grow by 7.5pc next year. The level of growth may appear robust by Western standards, but it would represent the slowest economic expansion in China for the last two decades. It is also perilously close to the 7pc minimum level of growth that Chinese economists believe is necessary in order to create enough jobs for the 6m university graduates who will enter the jobs market next year. It is the fourth interest rate cut from the Chinese central bank in the last ten weeks as the government desperately battles an evident economic collapse. "China is out to save itself here," said Patrick Bennett, an analyst with Societe Generale in Hong Kong. The PBOC reduced its main borrowing rate by 1.08pc points to 5.58pc, the biggest one-off cut since the Asian Financial Crisis in 1997. In recent weeks, a series of riots across central and southern China have flowered as disgruntled employees aired their grievances at the downturn. Today, around 500 protesters rioted at the Kai Da toy factory in Dongguan in the Pearl River delta, flipping over a police car and trashing computers in a dispute over payoffs to 80 fired workers. Tens of thousands of factories across the region have already shut their gates. Yin Weimin, China's Social Security minister, has revealed that employment is the Communist Party's number one concern in the downturn and said the "situation is critical". Unemployment is expected to rise from 4pc to 4.5pc by the end of the year and anecdotal reports have suggested that 3m people have already been fired in the industrial province of Zhejiang alone. Two major provinces, Shandong and Hubei, have already responded by banning companies from firing staff without permission from the government. The Chinese government has also announced a £373bn bailout to stimulate domestic growth by investing in infrastructure. However, only a fifth of the money is likely to come from central government coffers, with the rest coming from a mix of private enterprise and local government funds. "We're seeing a government that steps in, that is trying to do everything it can to keep growth at a decent rate, and has the financial means and the administrative capacity to make that happen," said Louis Kuijs, the head of the World Bank's China economics analysis. "All my colleagues were shocked by such a big easing. It signals the government may believe the economic situation is really serious for it to call for such a drastic move," said Liu Dongliang, a currency analyst at China Merchants Bank in Shenzhen. The reserve requirements of Chinese banks were also cut by 1pc point, and 2pc points for smaller banks, freeing up around 360 billion rmb (£34bn) for lending. (Unquote)
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Nanheyangrouchuan       11/27/2008 2:15:06 AM
The CCP may want to use absolute force, but things are still in the air as to how the PLA will respond, and the PLA might fracture between hardliners who support the status quo, hardliners who think the PLA should run things, warlords in the making who are looking for an opportunity to go their own way and those would just want the CCP to die.
The entire PLA knows about the lies fed to them by the CCP regarding Tiananmen square.
Heck, this may be the best time for the Tibetans to make an idependence move, as well as E. Turkestan, since the PLA might be busy protecting the CCP, internal power struggles and nationwide riots over food, pollution and jobs.

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WarNerd       11/28/2008 4:45:09 AM

Heck, this may be the best time for the Tibetans to make an idependence move, as well as E. Turkestan, since the PLA might be busy protecting the CCP, internal power struggles and nationwide riots over food, pollution and jobs.

The ratios of military power are just too large.  Any independence moves at this time would at best be quickly quashed.  At worst an independence movement would be initial successful, giving the central government an excuser to break the rebellious province by a major massacre.  The Chinese government wants the land and resources, however they would rather do without the indigenous people, so do not tempt them.
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